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NEW Zealand’s second largest port, Napier Port has reported record revenue and earnings for the financial year ended 30 September 2021. The resilience and diversity of its trade portfolio continues to mitigate the effect of container shipping disruptions and the absence of cruise ship visits caused by the ongoing pandemic.

Revenue rose 9% to $109.5 million from $100.4 million in the prior year, driven by record log exports of 3.02 million tonnes.

Underlying net profit after tax increased 7% to $22 million from $20.5 million, and reported net profit after tax increased 5.2% to $23.2 million.

Continuation of container-based supply chain and shipping disruptions are expected during 2022 and potential for log export market driven volume volatility.

Bulk cargo revenue rose 32.7% to $41.5 million from $31.3 million principally due to higher log volumes, which increased 27.6% to a record 3.02 million tonnes. Average revenue per tonne improved due to tariff increases, one off cost recoveries, and an improved cargo mix.

Container services revenue increased by 4.8% to $65.3 million from $62.3 million, thanks to a 2.9% increase in container volumes to 276,000 TEU and improved average revenue per TEU.

Chair Alasdair MacLeod said, “In the face of a global pandemic, lock-downs, global shipping congestion, disrupted shipping schedules and supply chains, Napier Port has over the last year again delivered on its commitments to its customers, its shareholders, and its region.

“We have kept the cargo flowing and have moved record volumes, the majority of which was the food and fibre exports that underpin the prosperity of our region. Meanwhile, we have continued to invest in the infrastructure that will support our region and our customers for the long term.

“Our new 350 metre-long 6 Wharf is the centre piece of this investment and we are very pleased with the progress we are making on this once-in-a-generation project.

“We are now pleased to report that we expect it to be operational in the second half of the 2022 financial year, earlier than the contractual completion date in the first quarter of the 2023 financial year.”

While risks remain, Mr MacLeod said, the port expects the final cost to range between $173 million and $179 million, lower than its earlier estimate of $173 million to $190 million.

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Chief executive Todd Dawson said, “I am immensely proud of the Napier Port team. Once again, they moved record volumes of cargo, working with customers to deliver supply chain solutions tailored to their needs and generated a strong financial result for shareholders.

“They did all of this while keeping each other and our community safe from the pandemic.

“Our success in attracting cargo from outside Hawke’s Bay has been a factor in driving increased volumes, with cargo owners valuing our ability to meet and secure their supply chain requirements with access to global markets and a port operation that continues to provide efficient, reliable, and resilient services.”

Mr Dawson said the results was “pleasing” when it is considered against the challenges faced within the global supply chain and container shipping trade.

Charter vessel visits for the bulk trade increased to 343 up from 304 the previous year. In contrast, container ship visits fell to 242 compared to 293 in the year before resulting from the ongoing volatility in global shipping.

Mr MacLeod said the diversity of trades that pass across Napier Port’s wharves have protected the company from container-based supply chain and COVID-19 disruptions.

“It is clear however that these disruptions will continue in the new financial year. We are living with COVID-19 in the community. To protect our people and our region we have implemented a mandatory vaccination policy for staff, moving towards mandatory vaccination for port access by end of the year.

“Meanwhile, inflationary pressures are building in the economy, while our customers are facing a broad range of additional pressures, including the availability of shipping equipment, space on ships, and labour availability.

“Nevertheless, we see continuing global demand for the food and fibre exports that underpin the economy of our region and the trade across our wharves.”

The port’s base-case volume forecast for log exports in FY2022 is in line with FY2021.

“We have been a beneficiary of buoyant log export markets for the past year, but we are not complacent about the potential for a cooling in these favourable conditions to impact volumes through Napier Port,” Mr MacLeod said.

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